Department of 'Ugh'
From the wild and woolly world of stock fraud comes word of a particularly nauseating pump-and-dump scheme. This one combined the worst features of Internet hacking and securities fraud. So says the Securities and Exchange Commission, which just took emergency action to shut it down.
The crooks were based in Estonia. Here's the SEC complaint.
I've been critical of the SEC, but this time it acted swiftly to smother a particularly noxious group of hoods.
Their scheme is fascinating in a repulsive kind of way.
In a typical pump-and-dump, the scamsters take a position in the stock, pump it on the Internet or through some other price-inflation method, and then dump their shares on the unwary. This time, the hoods pushed the stocks up by hijacking accounts and buying the shares through them. Then they dumped whatever position they had in the stock, purchased for pennies.
© 2006 Gary Weiss. All rights reserved.
Wall Street Versus America was published by Penguin USA on April 6.
Click here for its Amazon.com listing and here for more information on the book, from my web site.
Labels: microcap fraud